Coverage of Abortion in Large Employer-Sponsored Plans in 2023
Employer-sponsored health insurance is the largest source of coverage in the United States, covering 153 million people younger than age 65 in 2023. For 25 years, the annual KFF Employer Health Benefits Survey has asked private firms and non–federal government employers with three or more employees about the characteristics of their health plans. The specific benefits and services covered by those plans are shaped by many factors including costs, employer policies and beliefs, and state and federal regulations. Since the June 2022 U.S. Supreme Court’s Dobbs v. Jackson ruling overturning Roe v. Wade, there has been increased public and media attention about people with no or limited access to abortion, but little is known about abortion coverage in employer-sponsored plans.
This brief presents findings from the 2023 KFF Employer Health Benefits Survey on coverage of abortion services in large employer-sponsored health plans, changes employers made to abortion coverage since the 2022 Supreme Court ruling, and employers’ provision of financial assistance for travel out of state to obtain an abortion. This is the first survey of its kind to analyze coverage for abortion in employer-sponsored health plans. The survey was fielded from January through July 2023 and asked employers with 200 or more employees about their coverage policies for abortion.
Background
Ten states have laws that prohibit all state-regulated private plans from including abortion coverage. Most, but not all, have exceptions for pregnancies resulting from rape or incest or in cases in which it poses a threat to the life of the pregnant person. Conversely, ten states have enacted policies that require coverage of abortion services in all state-regulated private plans. In addition to individual and fully-insured group plans, states also regulate plans offered to state and local government employees.
However, neither the state-level abortion coverage inclusion nor prohibition requirements apply to all plans offered to workers in these states. Self-funding health care services for workers instead of purchasing a health insurance plan is a common practice among larger employers and those type of arrangements are regulated by the federal Employee Retirement Income Security Act of 1974 (ERISA). This law generally exempts self-funded plans offered by private employers from state insurance regulations. In total, 67% of covered workers at large firms are enrolled in a plan that is preempted from state insurance laws because their plan sponsors are non-public employers and the plan is self-funded.
Absent state insurance laws requiring or prohibiting coverage of abortion in state regulated plans, private employers offering self-funded plans may choose whether to offer coverage for abortion, or to only cover it under limited circumstances such as in cases of rape or incest or health endangerment of the pregnant person. The federal Pregnancy Discrimination Act states that employer health benefits plans that cover pregnancy services shall cover abortion in cases of life endangerment of the pregnant person or where medical complications have arisen from an abortion.
Findings
Coverage for Abortion Services
Ten percent of large firms (200 or more workers) that offer health benefits do not cover legally provided abortions under any circumstance in their largest plan; 18% cover abortion only under limited circumstances, such as rape, incest, or health/life endangerment; and 32% cover abortion in most or all circumstances (Table 1). Notably, 40% of those responding on behalf of large firms that offer health benefits do not know if their largest plan covers abortions, part of which could be attributed to lack of information about coverage for abortion in plan documents unless abortion is explicitly excluded. Survey respondents are generally human resources or benefits managers, though they are typically not legal experts (we ask to speak with the person at the firm who is most knowledgeable about the firm’s health benefits).
Forty-three percent of the largest firms with 5,000 or more workers that offer health benefits report that they cover abortion in most or all circumstances, compared to 34% of firms with 1,000-4,999 workers and 31% of firms with 200-999 workers (Table 1). A higher share of firms with 5,000 or more workers (30%) that offer health benefits cover abortion in limited circumstances only compared to firms with 1,000-4,999 workers (19%) and firms with 200-999 workers (17%). This juxtaposition can be attributed in part to the substantially higher share of smaller large firms reporting that they do not know if their largest plan covers abortion compared to the largest firms. Knowledge of the plan’s abortion benefits increases with firm size. Forty-two percent of large firms offering health benefits with 200-999 workers responded “Don’t know” to this question, decreasing to 18% of firms with 5,000 or more workers.
In addition, a large share of public firms (51%) reported that they do not know if their plan covers abortion, a significantly higher share than private for-profit (37%) and private not-for-profit firms (39%). Large public firms (23%), such as state and local governments, that offer health benefits are less likely to cover legally provided abortions in most or all circumstances in their largest plan than private for-profit (34%) or private not-for-profit firms (32%) (Table 1).
More large firms whose largest plan is self-funded (12%) report that they do not cover legally provided abortions under any circumstance than firms whose largest plan is fully-insured (6%), or that they cover abortion only in limited circumstances (21% vs. 14%) in their largest plan (Table 1). However, 49% of employers whose largest plan is fully-insured and 33% whose largest plan is self-funded report not knowing whether abortion is covered in their largest plan. On average, larger firms are more likely to be self-funded and larger firms are more likely to cover abortion. Therefore, differences by firm funding may be related to characteristics other than how the firm structures the plan.
Looking at the region in which the firm is headquartered, more than half (56%) of large firms offering health benefits and headquartered in the Northeast cover abortion in most or all circumstances in their largest plan, compared to those in the West (44%), Midwest (20%), and the South (18%). Large firms offering health benefits in the South (15%) and Midwest (14%) are more likely than firms headquartered in other regions of the country not to cover abortion under any circumstance in their largest plan (Table 1). A larger share of firms headquartered in the South (47%) than those headquartered in other regions of the country report that they do not know if their plan covers abortion, perhaps reflecting the complexity and changing landscape of abortion laws in many of these states. Although where a firm is headquartered is not necessarily where its largest plan is offered, these findings do largely mirror trends related to abortion rights and abortion coverage laws in states in these regions. See the survey methodology section for the classification of states into regions.
Changes in Coverage for Abortion Since the Dobbs v. Jackson ruling
The 2023 KFF Employer Health Benefits Survey also asked firms whether they had made any changes to their largest plan’s coverage of abortion following the U.S. Supreme Court’s ruling in Dobbs v. Jackson.
The ruling made national headlines and resulted in considerable changes in state-level abortion laws, which may have prompted some employers to review their plan’s abortion coverage, but overall, relatively few (8%) large firms offering health benefits report reducing or expanding coverage for abortion since the ruling. The vast majority of large firms whose largest plan does not cover abortion or only covers it in limited circumstances already had this coverage restriction prior to the Dobbs v. Jackson ruling (Figure 1). Overall, just 3% of these firms reduced or eliminated coverage for abortion where it could legally be provided since the ruling. Conversely, 12% of large firms whose largest plan covers abortion under most or all circumstances added or expanded this coverage following the ruling.
Financial Assistance for Out-of-State Travel for Abortion
Another aspect of employer coverage of abortion that has garnered increased public attention since the Dobbs v. Jackson ruling is employers providing financial assistance for travel expenses, such as airfare and lodging, for enrollees who have to travel out of state to obtain an abortion. In response to a growing number of state bans and restrictions that have made it more difficult to obtain an abortion in some states, several large companies announced that they would begin offering this benefit. Currently, fourteen states have banned abortion except in limited circumstances and many more have implemented restrictions such as early gestational stage limits, and additional requirements such as waiting periods and ultrasounds for obtaining an abortion, leading some pregnant people to have to travel to another state to obtain abortion care.
Overall, few firms offer this travel benefit. Among large firms that offer health benefits, only 7% said they provide or plan to provide financial assistance for travel expenses for enrollees who travel out of state to obtain an abortion if they do not have access near their home (Table 2). Twenty-seven percent of large firms offering health benefits do not know if the firm provides or plans to provide this assistance.
This benefit is significantly more common among firms with 5,000 or more workers (19%) than firms with 1,000-4,999 workers (10%) or firms with 200-999 workers (6%). Public firms (1%) are substantially less likely than private for-profit firms (8%) and private not-for-profit firms (10%) to cover out-of-state travel for abortion. A larger share of firms offering health benefits headquartered in the Northeast (13%) offer this benefit compared to those headquartered in other regions of the country. There are no statistically significant differences in firms offering this benefit by plan funding arrangement.
Eighteen percent of large firms that cover abortion in most or all circumstances in their largest plan also provide, or plan to provide, enrollees financial assistance for travel out of state to obtain an abortion, compared to 4% of those that cover abortion only in limited circumstances and 1% of those that do not cover abortion under any circumstances (data not shown).
Discussion
The majority of people in the U.S. have employer sponsored health insurance, so the coverage decisions that employers make play a role in access to care, including for abortion services, for covered workers and their enrolled dependents.
One-third of large firms that offer health benefits cover abortion in most or all circumstances in their largest health plan, while almost as many cover it under limited circumstances or not at all. However, four in ten respondents do not know whether their largest plan covers abortion. In some cases, this could be because plan documents such as summaries of benefits do not always contain information about coverage for abortion. The changing legal landscape in many states and the complexity of the issue could also explain some of respondents indicating they did not know. Survey respondents are generally human resources or benefits managers, though they are typically not legal experts.
If coverage for abortion is not mentioned in enrollee-facing plan documents, plan enrollees also may not be aware of their plan’s coverage policy for abortion without having to ask the plan (or third-party administrator) or their employer. This issue has gained more importance to policyholders, as 9 states have instituted laws that require state-regulated plans to include abortion as a covered benefit and to cover abortion care without cost-sharing, including copayments, coinsurance, or deductibles.
A less discussed law that could also affect coverage of abortion in certain cases is the Pregnancy Discrimination Act (PDA), which applies to employers with 15 or more workers. The PDA requires employer-sponsored health insurance to cover abortion in cases where the life of the pregnant person is endangered if the fetus were carried to term or where medical complications have arisen from an abortion. Some survey respondents may be unfamiliar with the Pregnancy Discrimination Act’s requirements when, in fact, the plan or third-party administrator must cover abortion in these very limited situations.
While the ruling in Dobbs v. Jackson and subsequent state activities pertaining to abortion have increased public interest in how abortion services are covered by employer-provided plans, so far, relatively few employers have changed their plan’s existing coverage for abortion since this ruling or decided to offer financial assistance for travel. This could be in part because employers are still considering their options under the current legal landscape (e.g., employers that choose to cover abortion services may still be subject to state civil and criminal penalties in states that prohibit “aiding or abetting” an abortion) or because benefits for the 2023 plan year may have already been finalized by the time Dobbs was decided. The extent to which employers continue to change their plan’s coverage for abortion or begin covering certain travel expenses, and the extent to which enrollees utilize these benefits, is not yet known.